Companies

Mumias lease suspended in fresh court directive

mumias

Mumias receiver manager Ponangipalli Venkata Ramana Rao. FILE PHOTO | NMG

BDgeneric_logo

Summary

  • Justice William Musyoka lifted the order a day after issuing the directive after it emerged that it conflicted with another order another court issued in December.
  • Kakamega County moved to court on Tuesday and obtained the order, stopping KCB appointed receiver-manager PVR Rao and Tumaz & Tumaz Enterprises, from interfering with operations of Sarrai Group.

The High Court in Kakamega has lifted an order that had given Uganda-based company Sarrai Group the green light to proceed with operations at Mumias Sugar Company.

This means that the lease of the miller stands suspended. Justice William Musyoka lifted the order a day after issuing the directive. This is after it emerged that it conflicted with another order another court issued in December.

Kakamega County moved to court on Tuesday and obtained the order, stopping KCB appointed receiver-manager PVR Rao and Tumaz & Tumaz Enterprises, which has contested the 20-year-lease, from interfering with operations of Sarrai Group.

While lifting the order, the judge said he was not informed of the December 29 order, which suspended the leasing process. The Judge said he ‘vacated’ the order, to avoid the scenario of conflicting orders.

“That, the order of 29/12/2021 should have been disclosed by the applicant (county government) since it cannot possibly be in operation at the same time with the order that I made herein on 11/1/2022,” said Justice Musyoka.

Sarrai won the lease after placing the third-highest bid of Sh11.5 billion in the lease battle, while Tumaz & Tumaz placed the highest with Sh27.6 billion.

Tumaz & Tumaz, through lawyer Javier Munzala, later moved to court arguing that Mr Rao failed to give all the bidders an open and transparent opportunity, compromising the integrity, fairness and accountability of the process.

Sarrai proceeded with the operations at the miller, prompting Tumaz to file contempt proceedings against Mr Rao and the owners of the Ugandan firm.

On Monday, Milimani High Court judge Anthony Ndung’u extended the order suspending the lease, pending the determination of the petition filed by Tumaz.

When they appeared before the judge on Monday, lawyers could not agree on the status quo with Sarrai insisting that they had started operations by the time the suspension was issued on December 29. But Mr Mwale’s lawyers said the leasing stands suspended.

[email protected]